The key to trading is determining the difference between a reversal and a momentary pullback.
A reversal signifies that the price is changing direction creating a new trend. First the price was going up and now going down or vice versa.
A momentary pullback occurs when the price goes flat, creating one or two green candles and then one or two red candles, etc. Finally, after a short while, the trend returns to the same direction as it was originally. The problem with pullbacks is that they create indecision. If you are going to have a loss, that is where it will happen. You failed to identify a reversal from a momentary pullback.
What if we could remove the indecsion by replacing the candlestick colors with the true trend color. That would simplify trading. Right?
That is precisely what our scripts do. Our intention is to make trading decisions simple.
Here we have identified the normal Japanese candlestick configurations along with our unique ability to simplify charting. This way, our scripts hve built in confirmations...Japanese candlesticks and 4 colors to show the true trend.
The top chart shows our scripts, removing the indecisions and replacing them with the true trend. The bottom chart is the standard candlestick chart, with lots of indecision, lots of red/green combinations.
The blue and magenta candlesticks show the reversal has started. The red and green candlesticks show the trend is continuing. Our scripts trade through the momentary pullbacks.
Compare where our scripts show the reversal starting with the chart at the bottom. On the bottom chart, where does the reversal start?